Ranking Member Waters' Statement Following the Biden Administration's Executive Order on Outbound Investments

Statement

"I welcome the Biden Administration's latest actions to restrict outbound investments to China, but more needs to be done. For several years, both through legislative action and convening hearings as previous Chairwoman of the Financial Services Committee, I have sounded the alarm on how private equity and venture capital funds, which collectively control more than $8.5 trillion in assets, are being used to finance military and technological development in the People's Republic of China.

While I am pleased that the Biden Administration's actions will better protect the United States, I believe the Executive Order and rulemaking on outbound investments must be broadened and strengthened. First, an outbound investment screening framework must account for supply chain resiliency, workers' interests, and climate risks, all of which have a significant impact on our nation's economy and security. Second, the Administration should consider expanding the proposal to cover passive forms of investing, such as mutual funds and index investing, that researchers have found are investing one trillion dollars in China-related securities. We must ensure that the savings of Americans are not being used to bolster the PRC's military or technological prowess. Finally, we should not give a pass to investments that Wall Street private equity and Silicon Valley venture capitalists have already made in China-based companies because they may also pose ongoing threats to U.S. national security, and therefore the rules should appropriately require divestment or revocation of existing investment agreements.

I look forward to the Administration promptly addressing these concerns and ensuring public and private U.S. investments do not undermine our nation."

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